Around 5pm this Thursday, on the East Coast of America, AMD executives will pack like sardines into a conference call and thousands of interested parties from across the globe will ‘dial in’ to hear the Q2 Earnings Call. But what will they be listening to? KitGuru makes some predictions.
First up, Wall Street (despite its recent history) is not staffed by dummies. Some of the smartest minds on the planet are employed by some of the deepest pockets in an attempt to predict what individual share prices will do on the open market. Apparently, there’s money in this investing game.
As the smart cookies finalise their calculations ahead of quarterly results, there is movement in the market. Red arrows don’t mean a display team is about to fly overhead. Rather, the little down-pointing triangle means that Wall Street (and the global investment community) expects the conference call to be bad – so the share price does a tumble as folks off-load their bad bets.
The little green triangle says something much more positive. It says that even though many analysts have had AMD at a ‘buy’ status for several months, they still think that the results (about to be announced) will be good enough to push the share price up once more.
The little green triangle says that the smart cookies are recommending even more money gets invested.
And that’s a good thing – if you’re AMD and the prediction is correct. Let’s have a quick look at each market segment and see if we can predict what’s going to be announced:-
Tough market. With overall sales seeming flat in this period, it’s hard to see that AMD could have increased market share much. However, the launch of the affordable, 6 core, Phenom II X6 has given AMD a lot of design wins into the majors. AMD even created a specific X6 SKU just for the global/multi-national brands, that was not offered to local system builders or end users directly. Sony’s move toward AMD from Intel was widely reported. The same goes for independents like Clevo.
KitGuru’s prediction? Small improvement in market share, but a much stronger improvement in margin.
Since launching the world’s first DX11 card back in last September, the ATI Radeon 5000 graphics series has met with little resistance in the market. Market rumours suggest that nVidia was so sure that they could not sell against the 5000 series, that it actually reduced its orders with TSMC. As a result, the overall market suffered a huge constriction around the busy Xmas period. Now that nVidia finally has some DX11 products in the market, we’d expect to see the Q3 figures be closer. But Q2 sales would have largely been sorted before nVidia was ready to ship.
KitGuru’s prediction? Increase in market share for AMD with a significant swing from GeForce to Radeon. If it’s in the 5-10% range, then nVidia will get a chunk back in Q3. If the swing is 15% or more, then it will be much harder for nVidia to reclaim that ground.
Also worth checking the notebook graphics market. AMD moved quickly not only to DX11, but also to low-cost DX11. Entry level DX11 processors will be the GPU of choice for notebook manufacturers and there is only one vendor.
KitGuru predicts a bigger increase in market share for ATI Radeon into the mobile space.
Why oh why did AMD every cancel the ATI chipset programme for Intel? We’ll never know. Around the RS400, Intel was so impressed with the chipset that it bought tons of them for its own mainboards. Times have definitely changed. With nVidia dropping out of the chipset business, the AMD CPU market is only really catered for by the AMD chipset vendors. CPU to Chipset is a 1 to 1 relationship.
KitGuru prediction? Slight increase.
Right about now, AMD’s senior execs will be practising hard for the analysts’ Q&A that will follow Thursday’s call.
The PR spinners will be peppering them with so many questions that, by the time the call starts, they’ll have to pause before coming up with the correct answer to questions like “And what’s your name?”.…
Seasoned pros that they are, a slip is unlikely, but all of us journalists live in hope.
Want to hear grown men with 7-figure salaries answer simple questions cautiously while analysts struggle to sound incisive? Try this link.
KitGuru says: With John Byrne’s sales team picking up additional business from Dell and Apple, as well as the big independent notebook makers like Clevo, AMD’s figures will almost certainly be strong. But this will be nothing compared to the HUGE increases in market share that experts believe AMD will make in the mobile space in 2011. AMD’s first generation Fusion processors, like Llano, have started test production in readiness for a launch around Christmas. If Llano and its fellow Fusion fighters hit decent yields out of the foundry (i.e. they work and there’s plenty of them), then the Q2 2001 call for AMD will be a blast – and KitGuru predicts a lot of green triangles.